What Can This IPO Tell You About The Market?
A late-day rally sparked
by falling oil prices sent the indices
higher on Wednesday. Volume was light. Traders are talking about how
$50 oil will impact the economy. Saudi Arabia said they would open a new oil
field earlier than expected and Russia said that Yukos could use frozen assets
for operating purposes. Just yesterday OPEC said they could not increase
production. Oil at this level raises the stakes in Friday’s employment report.
In the weekly petroleum report, oil inventories were down 1.9 million barrels;
gasoline was up 2.4 million barrels. Oil sold off late in the day, closing atÂ
Oil stocks also closed lower. Airlines and transports rallied on the lowered oil
prices.
The ISM non-manufacturing index rose more than
expected, to 64.8 in July, up from 59.9 in June; this is the 16th consecutive
month of expansion. New factory orders rose +0.7%, more than expected after a
revised +0.4% in May.
The semis were upgraded at Smith Barney; the $SOX
is near 14-month lows, just over 400.
Word on the Street is that hedge funds are
reluctant to bid a high price for Google; IPO shares are expected to price
between $108-$135 later this month.
The Nanosys IPO was withdrawn, citing
“adverse market conditions.” The deal, led by Merrill and Lehman, was considered
to be a key gauge for Nanotech stocks. The price for the PlanetOut IPO
was reduced; the deal is led by SG Cowan.
Tomorrow, look for retail sales figures.
| Dow | -36.26 | 10124 |
| S&P 500 | -5.36 | 1100 |
| Nasdaq | -13.08 | 1855 |
Strong today were: Semis
(
SOX.X |
Quote |
Chart |
News |
PowerRating) +0.37%, Biotech
(
BTK.X |
Quote |
Chart |
News |
PowerRating) +0.22%, Computer
Technology
(
XCI.X |
Quote |
Chart |
News |
PowerRating) +0.5%.
Weak today were: Internet
(
GIN.X |
Quote |
Chart |
News |
PowerRating)
-3.95%, Airlines
(
XAL.X |
Quote |
Chart |
News |
PowerRating) -2.37%, Oil
(
XOI.X |
Quote |
Chart |
News |
PowerRating) -1.44%.
10-year Notes were -020 at 111 005
The dollar
was +0.03 at 89.60
Gold was flat at 392.80
Crude Oil was -1.32 at
42.82
Volume was 1.36 billion
on the NYSE and 1.67 billion on the Nasdaq.
Market breadth was negative.
| NYSE | Issues | |
| Advancing | 1604 | Up Vol 579 |
| Declining | 1677 | Down Vol 773 |
| Ratio | 1.04 | 1.33 |
| Nasdaq |
||
| Advancing | 1374 | Up Vol 671 |
| Declining | 1718 | Down Vol 986 |
| Ratio | 1.25 | 1.46 |
Stocks in the news:
The FDA approved Eli Lilly’s depression
drug Cymbalta; analysts say the drug could generate $2 billion in sales.
Lilly also makes Prozac.
The FDA OK’d Pfizer’s Lipitor ads, which claim
the drug reduces the chance of heart attack.
Cigna
(
CI |
Quote |
Chart |
News |
PowerRating) reported $0.50 above
expectations and raised guidance for 2004.
Bristol Meyers
(
BMY |
Quote |
Chart |
News |
PowerRating) will pay $150
million to settle fraud charges; the company will also appoint an independent
advisor to monitor accounting practices.
Wal-Mart (WMT) will pay a $10 million fine
to settle charges the company knowingly hired undocumented workers as cleaning
crews.
InterActive (IACI) fell 18% after
reporting a 25% drop in profits and guiding lower.
Ciena (CIEN) guided lower; revenues were
lighter than expected.
Eliot Spitzer will take legal action against
Express Scripts (ESRX); charges include over-inflating the costs of
generics.
Brice Wightman
Â